Gardner looks to raise utility rates 12 percent

Danedri Thompson[email protected]
Gardner residents may get hit with a 12 percent increase in sewer and water rates. City finance director Laura Gourley said rates must increase by that amount to perform deferred repairs and maintenance on existing facilities and equipment.
“That only covers immediate needs,” she told council members during a July 1 work session.
The rate increases would cost the average homeowner 35 cents per day or nearly $130 annually.
Next year’s utility budget includes several repairs to existing equipment, including $55,000 to update piping at the Kill Creek Waterwater Treatment Plant. The plant was built in 2002. Another $100,000 would be devoted to painting the Hillsdale clear well. A $1.1 million package plant would increase capacity at Hillsdale Water Plant, which Gourley said is a short-term solution. The plant is at 90 percent capacity.
The budget also includes the addition of one new utility employee, who would divide time between the water and wastewater departments.
The rates will need to increase at similar percentages for several years to maintain Gardner’s current facilities, she explained.
Council member Kristina Harrison asked if there was room in the electric utility budget, which is governed by a separate board, to buy down water rate increases. Council member Heath Freeman asked if some of the funds in reserves could be used to buy down rate increases as well.
Last year, council members thought they would need to increase rates by 6 percent, but Gourley said those rate increases were based on rosy growth projections.
“Rates are driven by growth,” she said. “We do not have growth so we have to hit our residents.”
She listed a series of projects for which Gardner was considered including Legoland in Kansas City, Mo., and the racetrack and Legends Shopping Center in Kansas City, Kan.
Council member Larry Fotovich said Legends is not a good example.
“Taxes in that area for residential homeowners have gone up,” he said. In some areas, taxes have increased as much as 40 percent while housing values have decreased in Kansas City, Kan.
“Their taxes went up even more than ours,” Fotovich said. Gardner’s taxes have increased almost 30 percent in the last four years.
“I think you can have a model for the city that takes care of the people that are already here and makes it so nice that people want to come here,” he said. “You would think all of that (Kansas City, Kan.) growth would bring prosperity. It’s a lot of empty promises.”
Council member Steve Shute said he also had a visceral reaction to the use of Legends as an example of the benefit of growth. With the Legends project, the developer declared bankruptcy, Shute said.
“They still don’t know how they’re going to retire that debt,” he said.
He said municipalities are very bad venture capitalists, and that the city should be careful in providing tax dollars to developers chasing growth.
Gourley told council the general fund budget is being developed using four priorities council members set in April. They are: promoting economic development; improving the quality of life; fiscal stewardship; and infrastructure and asset management.
To promote economic development, city staff will propose a 2014 budget that includes $80,000 for a comprehensive plan update; $30,000 for economic development technical studies to assist in cost-benefit analysis of proposed projects; $20,000 for an updated city website; and $25,000 to fund an economic development partner. Currently, the city pays $25,000 in membership fees to the Southwest Johnson County Development Corporation, but council members have yet to reach a consensus on whether to continue that practice.
Gourley said the $4.7 million budget proposal also adds of new staff members including a street maintenance worker, a police officer and a network administrator before the end of 2013 and a special projects manager, an administrative assistant and two new police officers in 2014.
Gourley said with city has doubled in size every 10 years for the last 30 years, she projects a population of nearly 40,000 by 2020. Gardner’s staffing is far behind cities outside of the metro area with populations that large.
“We need to be prepared for the growth or we will be steamrolled,” she said.
The growth projections, however, are in contrast to growth projections a team of consultants are using to develop the southwest Johnson County Area Plan.
Consultants funded by the Kansas Department of Transportation, Johnson County, Gardner and Edgerton project 19,000 new residents over the course of 30 years. Of those, they project 6,000 will be due to intermodal growth.
Municipal budgets must be approved by the council and forwarded to the state of Kansas no later than Aug. 25.